Correlation Between Koza Anadolu and Ozerden Plastik

Can any of the company-specific risk be diversified away by investing in both Koza Anadolu and Ozerden Plastik at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Koza Anadolu and Ozerden Plastik into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Koza Anadolu Metal and Ozerden Plastik Sanayi, you can compare the effects of market volatilities on Koza Anadolu and Ozerden Plastik and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Koza Anadolu with a short position of Ozerden Plastik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koza Anadolu and Ozerden Plastik.

Diversification Opportunities for Koza Anadolu and Ozerden Plastik

0.81

Correlation Coefficient

Koza Anadolu  Ozerden Plastik

Very poor diversification

The 3 months correlation between Koza and Ozerden is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Koza Anadolu Metal and Ozerden Plastik Sanayi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ozerden Plastik Sanayi and Koza Anadolu is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Koza Anadolu Metal are associated (or correlated) with Ozerden Plastik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ozerden Plastik Sanayi has no effect on the direction of Koza Anadolu i.e., Koza Anadolu and Ozerden Plastik go up and down completely randomly.

Pair Corralation between Koza Anadolu and Ozerden Plastik

Assuming the 90 days trading horizon Koza Anadolu Metal is expected to under-perform the Ozerden Plastik. In addition to that, Koza Anadolu is 1.29 times more volatile than Ozerden Plastik Sanayi. It trades about -0.27 of its total potential returns per unit of risk. Ozerden Plastik Sanayi is currently generating about 0.08 per unit of volatility. If you would invest  851.00  in Ozerden Plastik Sanayi on September 22, 2024 and sell it today you would earn a total of  23.00  from holding Ozerden Plastik Sanayi or generate 2.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Koza Anadolu Metal  vs.  Ozerden Plastik Sanayi

Koza Anadolu Metal

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Koza Anadolu Metal has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, Koza Anadolu is not utilizing all of its potentials. The newest stock price confusion, may contribute to short-horizon losses for the traders.

Ozerden Plastik Sanayi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ozerden Plastik Sanayi has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, Ozerden Plastik is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Koza Anadolu and Ozerden Plastik

The main advantage of trading using opposite Koza Anadolu and Ozerden Plastik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koza Anadolu position performs unexpectedly, Ozerden Plastik can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ozerden Plastik will offset losses from the drop in Ozerden Plastik's long position.

The idea behind Koza Anadolu Metal and Ozerden Plastik Sanayi pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

Check out your portfolio center.

Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Fundamental Analysis module to view fundamental data based on most recent published financial statements.